At issue are Facebook's Instant Personalization feature; the inability of Facebook users to make the 'Likes and Interests' section of their profile private; and the fact that Facebook discloses user profile information in certain ways even if a user has elected to keep that information private.

The complaint asks the FTC to order Facebook to "restore privacy settings that were previously available...give users meaningful control over personal information, and seek other appropriate injunctive and compensatory relief."

Here's a quick look at the three main points of contention contained in the FTC complaint:

Instant Personalization

A new service unveiled by Facebook in April allows select Facebook partners to automatically tailor Web site visits to your personal tastes when signed into Facebook. The new feature, called Instant Personalization, is currently available only on Yelp, Pandora, and Microsoft's new document sharing site, Docs.com. Whenever you visit Pandora, for example, the site can automatically grab your music preferences from the 'Likes and Interests' section of your Facebook profile. Pandora can then show you music selections it thinks you might like, and all of this happens without any action on your part.

On the one hand, this is a great way for services to cater to your tastes and preferences. The problem is, the FTC complaint argues, Instant Personalization discloses this information "without first obtaining users' consent." Even though Facebook provided users with large notifications about the new Instant Personalization when the service launched, the social network automatically turned on the new feature for all users when Instant Personalization launched. Facebook has since moved to an opt-in instead of an opt-out model for Instant Personalization, according to EPIC.

Information Leak

Facebook has also made it difficult to block Instant Personalization if a user doesn't want to use the new feature. Even if a user opts out of Instant Personalization, their information can still be "disclosed to third-party sites through the user's friends who have not disabled Instant Personalization." To completely stop Instant Personalization from accessing your information through a friend's profile, you have to visit the Facebook page for every Instant Personalization site and click the 'Block application' link. As I argued in April, this policy places an unfair burden on the user, especially if Facebook expands the Instant Personalization service from just three partners to include hundreds of sites.

The FTC complaint accuses Facebook of concealing a "users' ability to fully disable Instant Personalization" through the social network's 'block application' process. The complaint also points out that "Facebook has so effectively concealed the process of disabling Instant Personalization that many outside articles have been devoted to guiding users through the process." PCWorld has devoted many articles to privacy concerns over Facebook's new features some of which you can find here, here, here, and here.

Connections are now made publicly available by default. EPIC and the other privacy groups are concerned about this policy since most users signed up for Facebook with the understanding that some of this reclassified information would not be made public. The complaint also takes issue with the fact that 'Likes and Interests' are no longer plain text entries, but are linked with outside pages and pages within Facebook.

This means that while a user can elect to hide their likes and interests from other Facebook users, that information is still publicly available on "friends' pages, community pages, and to third-party Web sites."

Murky Privacy Policy

This disclosure of previously private information leads to what may be the most damning and inflammatory accusation in the complaint against Facebook. The privacy groups argue that Facebook's "privacy settings are designed to confuse users and to frustrate attempts to limit the public disclosure of personal information that many Facebook users choose to share only with family and friends."